Door opener for small exporters

-Export Credit Norway and GIEK’s new product for export contracts below NOK 100 million is a door opener for many, including small and medium size enterprises (SME), to make use of government export funding, said Martin Daun, partner in Optimo Finance following Export Credit Norway and GIEK’s breakfast seminar and webinar on renewable energy last week. He believes this will lead to closing of more projects.

Daun was one of 43 people that attended the breakfast seminar in Export Credit Norway’s offices in Oslo 21 January. Around 11 people followed the presentation online.

The two institutions are organized below the Ministry of Trade, Industry, and Fisheries and fund export of Norwegian capital goods in all industries across the world.

The exporter previously had to send one application to each institution when Export Credit Norway acted as lender and GIEK issued a guarantee. The new, simplified product requires just one combined application for export contracts under NOK 100 million.

The seminar was introduced by Jon Dugstad, Director at Intpow, while the presentation was held by Øyvind Ajer, Director Energy and Industry at GIEK, and Ivar Slengesol, Director of lending at Export Credit Norway. They had two ambitions:

-Every export business in Norway that may make use of export funding must be familiar with our offer and can use it as part of the sales process. And the process must be as simple, cheap, and fast as possible for the client.

-I believe working coordinated like this is a great advantage, not least for the client, but also for us [as a bank] which can then tell our clients that they can contact the policy implementation system for export funding, where they have a straight forward process, he said.

Funding of small export contracts within renewable energy is difficult to obtain from commercial banks.

-GIEK and Export Credit Norway is often the only alternative. This can lead to the financing of the contracts becoming for complicated and hence more expensive for the exporter, said Øyvind Ajer from GIEK.

Jacobsen from DNB agreed and underlined that banks often refer clients to the policy implementation system in these cases.

In addition to a simplified process for contracts under NOK 100 million, GIEK and Export Credit Norway also loosen the requirement of bank involvement in risk coverage in contracts below NOK 30 million. In the smaller contracts, GIEK can then guarantee for up to 90 percent of the loan, while the rest of the loan risk can now be covered by the exporter issuing a supplier credit to the buyer.